Sounds like it is toast. The main problem with the T-5 is that once you blow them, the case is usually junk. I'd definately start hitting the classifieds for a spare. You also might try skipping 2nd, run first gear up to 4000 then going directly to third.
If at all possible, I'd stop driving it right now. If 2nd gear is busted up, you got debris in the bottom of the trans and if a chunk gets somewhere it shouldn't, it can be real bad news.
You been powershifting or doing a lot of burnouts in this thing? If all you done is what's in your sig, that car shouldn't have shelled the tranny out.
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